Microsoft Sets Record-Low 5-Year Bond Yield at 0.993%

By Michael Aneiro

The corporate bond market closed out the week by welcoming the first-ever five-year corporate bond with a yield under 1%.

Microsoft (MSFT), one of the last remaining U.S. companies with triple-A credit ratings, sold $2.25 billion of bonds, including $600 million of five-year bonds that yielded 0.993%. That marks the lowest-ever yield for a five-year corporate bond deal, according to Standard & Poor’s Leveraged Commentary & Data, besting the 1.06% yield on a Bristol-Myers Squibb (BMY) five-year bond sale on July 30, when underlying Treasury-bond yields were at record-low levels.

The rest of Microsoft’s bond sale consisted of $750 million of 10-year bonds that yielded 2.189% and $900 million of 30-year bonds that yielded 3.562%.

It was the software giant’s first bond offering since February 2011. Proceeds will go toward general corporate purposes.